Marketing Principles of National Basketball Association (NBA) - Essay Example

?Marketing Principles of National Basketball Association (NBA) Contents 3 Introduction 3 Overview 3 The purpose/role of branding 3 Importance of Market segmentation to marketers 4 Importance of marketing mix to marketers 5 Promotion 5  Place 6 References 7 Abstract The purpose of this project is to study the marketing principles of the NBA (National basketball association). The purpose of branding and market segmentation of the organization is studied. The marketing mix including the product, promotion, price and place of NBA is studied. The competitors and the sponsors of NBA are also studied in this project to understand the marketing strategies of the organization. Introduction The National Basketball Association (NBA) is one of the men's professional basketball leagues in the world. It is the pre-eminent men’s professional basketball league in North America. NBA is an active member of USA Basketball (USAB). The NBA is one of the four major North American professional sports league. By average annual salary per player, NBA players are the world's best paid sportsmen. As the Basketball Association of America (BAA), in New York City  the foundation of the league took place on June 6, 1946.  After rival National Basketball League (NBL) was absorbed, the National Basketball Association name was adopted by the league on August 3, 1949. NBA has many franchised member clubs. The directions for NBA Entertainment and NBA TV studios are provided from offices located in Secaucus, New Jersey. (NBA, 2013) Overview In the following project the branding strategies of National Basketball Association is discussed. The main competitor of NBA is Major League Baseball. The basic branding and marketing strategies of both the leagues and their impact is also discussed. The market segmentation of NBA based on demographic characteristics of people is done. The marketing mix of NBA, its product positioning, distribution through franchising, pricing through sponsorship and promotion in different events is the major cause of its success as a brand. The purpose/role of branding A term, name, design or symbol or a combination of them intended for identification of the services and goods of a seller or a group of sellers which helps in the differentiation of them from those of those of other sellers is called a brand. Branding involves providing customers the view that the brand is the pone solution to their problems and not just focusing on the target market to chose the brand over competitors. Branding is important to marketers as it confirms credibility, clearly delivers the message of the product or service, emotionally connects the target prospects, concretes user Loyalty and also motivates the buyer. NBA is a strong brand as compared to its competitors. NBA is at the third position in the list of 25 of The Most Engaged Brands on Instagram. NBA provides live videos behind the scenes which has made it popular among people. (Rampton, 2013) The Competitor of NBA- The major competitor of NBA is MLB (Major League Baseball). MLB constitutes one of the major professional sports league in North America. The attendance in stadium and the revenue hence generated is higher in MLB than in case of NBA. But the noticeable star players are much more in NBA than in MLB. The national imaginations are not captured by MLB personalities. But NBA players are well known even outside the basketball circles. There are not any major differences in the national TV ratings of both leagues. Most of the money is generated through local sports TV networks. Basketball is decidedly spry while Baseball is decidedly gray according to the analysis of TV audience. Both the leagues have lost audience however since the 90s. The demography has a major role to play in the competition in the two leagues. Generally the NBA is followed more by Younger people as opposed to MLB. The marketing strategies and their impact on audience are more effective in case of NBA than that of MLB. (MLP, n.d.) Importance of Market segmentation to marketers The process of identification of groups of consumers whose purchasing behavior is unique and important for the product is called market segmentation. The segmentation of the market is based on geography, demography, psychological and social-cultural factors. The market segmentation allows the firms to adjust marketing mix to meet the needs of separate market segments. By identification of the common situational, environmental, demographic, behavioral and structural characteristics of their ideal customers the organization can create ideal customers for each of their target markets. Market segmentation defines the edges or boundaries of the market. It is typically based upon demographic dimensions like location, industry sector and organization size. The market segmentation of NBA is based on the different demographic origins of the people. The sports lovers of different demographic region are the target market. The people interested in basketball are segmented by their demographic characteristics into different basketball teams of NBA. (Bowman and Gatignon, 2010) Importance of marketing mix to marketers The marketing mix is the tools available to a business to gain the reaction it is seeking from its target market in relation to its marketing objectives. The marketing mix consists of the product or services of the firm, the promotional activities for the products or services, the place of distribution or the location where the products and services will be offered to the customers and the price of the product. First of all the product includes providing excellent basketball teams that play and win in an exciting way. However, there are other ingredients of the product including merchandising such as the sale of shirts, and a range of memorabilia. The product also relates to television rights. And, of course its products are sold across the globe, through the club's website and a range of other sales media.  NBA markets itself as a global brand. The league also engages in a range of joint promotional activities. NBA books, shirts, key rings and many other items are sold and promoted through its website. The league has positioned itself at the up market premier end of the market and, as a result, it tends to charge premium prices as evidenced by the high cost of a season ticket to watch home league games. Product The product is a good or service that satisfies the demand of a consumer. The NBA is a basketball league. NBA has other ingredients of the product including merchandising and also sells Jersey, t-shirt, hat, hardwood classics, footwear, accessories and essentials of basketball of its various teams through its online store called NBA Store. The major competitor of NBA is MLB (Major League Baseball). The various sports played in the world provide competition to other sports. The different teams for different regions and good advertising campaigns have helped NBA to establish itself among its competitors in the sports industry. (NBA Store, n.d.) Promotion NBA markets itself as a global brand. The league also engages in a range of joint promotional activities for example, the promotional activities of Taco Bell and NBA. (McCarthy, 2013).NBA books, shirts, key rings and many other items are sold and promoted through its website store.NBA.com. (NBA Store, n.d.).The location of a product within a market, i.e. presenting it is an up market or down-market product is called positioning or repositioning of the product - refers. NBA positions its product as a product for basketball liking consumers. The promotion of NBA league is supported by its corporate partners, who include Ochsner, Chevron Human Energy, Entergy, Cox, Capital One Bank, Crystal Clear Imaging, Peoples Health and many more.  Price The amount of money that is paid by a customer for the product or services is called the price of that product or services. The revenue and survival of the company depends upon the price of the product. The demand for NBA is high in sports due to its promotion and pricing strategies. The NBA follows a dynamic pricing strategy. The NBA uses the dynamic pricing system for providing the best ticket values for its fans and earns revenue. The utilization of advanced computer pricing software, on ticket availability in real-time based prices for single games are adjusted and different changing factors such as star players, league standings, day of the week, opposing team, rivalries and supply and demand. The fans are empowered by dynamic pricing as during their ticket purchasing process more options are provided to them. The prices of the tickets are a reflection of the actual market value. More likely chances of getting the best value is provided to fans who purchasing early tickets. (NBA, n.d.) (ESPN, 2013)  Place The place as a part of the marketing mix refers to the distribution of products and services, i.e., to provide them at places convenient for the consumers to access. Various strategies are used in this element of marketing mix by different firms. NBA uses franchising as mode of entry into sports market and availability to customers. NBA franchises active consecutive non-playoffs and all time. Some of the active franchise of NBA includes, Atlanta Hawks, Brooklyn Nets, Dallas Mavericks, Chicago Bulls etc. the defunct franchises include St. Louis Bombers, Toronto Huskies, Waterloo Hawks, etc. (NBA, n.d.) References NBA. N.d. Available at http://www.nba.com/ [accessed on 10th December 2013] Rampton, John. 2013. 25 of the Most Engaged Brands on Instagram. Available at http://www.searchenginejournal.com/25-engaged-brands-instagram/ [accessed on 10th December 2013] MLB. N.d. Available at http://mlb.mlb.com/home [accessed on 10th December 2013] Bowman, Douglas and Gatignon, Hubert. 2010. Market Response and Marketing Mix Models: Trends and Research Opportunities. Available at http://books.google.co.in/books?id=-7F0gqdD8FQC&printsec=frontcover&dq=marketing+mix&hl=en&sa=X&ei=jtqmUuOBNIP_iAfWqoHoBg&ved=0CC0Q6AEwAA#v=onepage&q=marketing%20mix&f=false [accessed on 10th December 2013] NBA, n.d. Available at www.store.NBA.com [accessed on 10th December 2013] McCarthy, Michael. 2013. Taco Bell and NBA Team Up to Feature Every Game-Winning Shot. Available at http://adage.com/article/news/taco-bell-nba-team-feature-game-winning-shot/244744/ [accessed on 10th December 2013] ESPN, 2013. ESPN NBA. Available at http://espn.go.com/nba/ [accessed on 10th December 2013] NBA. N.d. Franchise History. Available at http://stats.nba.com/history.html [accessed on 10th December 2013] NBA. N.d. Corporate Partners. Available at http://www.nba.com/pelicans/contact/crescent_city_champions.html [accessed on 10th December 2013] NBA. N.d. Dynamic Pricing. Available at http://www.nba.com/wizards/dynamic-pricing [accessed on 10th December 2013] Read More